Making crypto lending mainstream: How this platform breaks DeFi barriers
Liquidation and overcollateralization issues are still the main challenges in the DeFi space, but this layer-1 protocol attempts to challenge the status quo. Since emerging, decentralized finance (DeFi) has revolutionized finance by providing accessibility and control. Crypto lending is one of the most critical use cases in DeFi, enabling crypto holders to lend and borrow assets without intermediaries, thus democratizing access to financial services. Challenges faced by DeFi The privileged position of lending protocols in DeFi is underlined by the three most prominent players in this subsector: Aave, JustLend and Compound. Together, these platforms boast over $12 billion in total value locked (TVL) — about 23% of DeFi’s overall TVL of $50 billion as of mid-July 2023. These numbers demonstrate the immense potential and interest in decentralized lending. Nevertheless, DeFi lending still faces critical challenges. The two main concerns are overcollateralization and the high risk of li...